By Guy Page

Gas and oil prices in Vermont will not rise due to tariffs on Canadian petroleum products imports, which are exempt under the Trump administration’s current tariff plans, Secretary of the Agency of Commerce and Community Development Lindsay Kurrle told legislators Wednesday morning. 

All products of Canada and Mexico that comply with the United States-Mexico-Canada Agreement (USMCA) and are imported into the United States are exempt from the National Emergency Tariffs, the White House decided in early March. Earlier tariffs on Canadian aluminum and steel are still in force. 

Kurrle’s made her comments to a joint meeting of the Vermont House and Senate economic development and commerce committees, after Senate Pro Tem Phil Baruth and several other legislators delivered a public apology to Canada on behalf of Vermont for the tariffs. 

Canada – VT trade imbalance – Canada is Vermont’s largest foreign trading partner. In 2023 we imported $2.5 billion and exported $683 million of goods, according to an ACCD report. 

Worldwide, Vermont in 2023 imported almost twice as much (in terms of dollars) as we export. According to a May 30 ACCD report, Vermont exported $1.99 billion worth of goods and services in 2023. This figure represents 1.14% of the state’s total output of $174.1 billion dollars. In that same year the state imported $3.77 billion representing 2.17% of total output. Exports have declined in every year since 2010 with the exceptions of 2018 and 2021. 

In particular, Vermont imports most of our heating oil, northwestern Vermont/Champlain Valley natural gas, and gasoline from Canada. When the Trump administration took office in January, heavy tariffs on all imports from Canada, including energy, were proposed. However, the latest plans call for zero tariffs on products imported from Mexico and Canada provided they are not ‘pass throughs.’ 50% of the product must be sourced from Mexico or Canada in order to be tariff exempt, both Kurrle and Vermont foreign trade negotiator Tim Tierney told the committees. 

‘A lot of the stuff we import has its origin in North America,” Tierney said. “Not affected,” he summarized.

In fact, Canadian companies are still considering locating facilities in Vermont. For example, a Sherbrooke company will be coming to St Johnsbury to make boots for state police, Tierney said.  

Despite a profusion of apologies from legislators at the beginning of the hearing, including Baruth and Rep. Kirk White of Bethel, there was little or no discussion of the U.S.A. or Vermont suffering economic loss due to the trade imbalance, which Trump said has led to the tariffs. 

In fact, a Canadian trade official defended Canadian tariffs as hard but good medicine. 

“Tariffs are like immunotherapy, a poison we take on ourselves to fight the bigger battle,” Dan Kelly, President of the Canadian Federation of Independent Businesses said. Small businesses now regard America as an ‘unreliable’ business partner, he said  – something he never would have imagined happening before during his 30 years as a Canadian business advocate. Still, there is a pathway of Canada coming out ahead if it maintains our USMCA agreement and the U.S. government applies its tariffs across the world, Kelly said. 

“I appreciate your chemotherapy reference,” one legislator, adding that he hopes for the day when the trade illness is in remission.

Sen. Alison Clarkson – whose aunt was Governor General of Canada – decried that “that one person [Trump] can have such an impact…..All of us need to appreciate that consolidation of power and how detrimental it can be to so much.” Clarkson was not alone in her Canadian affiliations. Five of the 15 legislators on the Senate and House commerce committees stated that they either were raised in Canada, are part Canadian, or are married to a Canadian.

Canadian tariffs on U.S.A., before and during Trump administration

In response to the U.S. imposing tariffs on Canadian goods, Canada implemented countermeasures earlier this year. On February 1, 2025, Canada announced 25% tariffs on $155 billion worth of U.S. goods, with the first phase targeting $30 billion in imports effective February 4, 2025. The targeted products included orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics, and pulp and paper products. ​

Then on March 4, Canada expanded its countermeasures by imposing 25% tariffs on an additional $30 billion worth of U.S. goods, effective immediately. This action was in response to further U.S. tariffs on Canadian steel and aluminum products. The Canadian government also initiated a public consultation period, ending on April 2, to consider imposing tariffs on an additional $125 billion worth of U.S. imports. No official announcements have been made since.

​Prior to 2025, Canada and the United States experienced notable trade tensions, leading to the imposition of tariffs by both nations. 

In 2018, the U.S. imposed tariffs on Canadian steel and aluminum under Section 232 of the Trade Expansion Act, citing national security concerns. Canada responded with retaliatory tariffs on U.S. steel, aluminum, and various other products. These tariffs were lifted in 2019 following negotiations. 

However, in 2020, the U.S. re-imposed a 10% tariff on Canadian aluminum, to which Canada planned countermeasures but both countries reached an agreement to remove these tariffs by late 2020. These pre-2025 tariff disputes were characterized by cycles of imposition and negotiation, reflecting the complex trade relationship between the two countries.